How Do You Know If You Need to Complete a Tax Return
Taxes can be a bit tricky, especially without the help of a professional. For example, you may be wondering if you need to complete a tax return. And if so, what would you need to do? If you’re finding yourself in this predicament, we’re here to help with a simple guide on tax returns in the UK.
What Is the Tax Return System in the UK?
Tax returns are pretty straightforward when it comes to the UK. The UK tax system is self-assessment, which means you’ll have to estimate what your tax liability is and then file a return to pay the amount. It’s a good idea to have a bit of knowledge and understanding of the system, especially if you’re going to be filing as a sole trader or an independent contractor.
Do You Need to Complete a Tax Return?
Here are some situations in which completing a tax return is necessary:
- If you earn income in the UK, or if you are a UK resident who has income from abroad, you may need to complete a tax return.
- If the income is earned in the UK, you’ll need to fill out a Self-Assessment tax return.
- If your income comes from employment and you’re classed as an employee, you may need to file a tax return each year.
- If you were self-employed, though, you’d need to fill out a self-assessment tax return.
On the other hand, here are some cases where completing a tax return is either not necessary or optional:
- If you have income from outside of the UK, you wouldn’t need to complete a tax return.
- If you have income from employment, you’d only need to file a tax return if you earn more than the tax-free personal allowance.
- If you earned less than £11,850 in the previous tax year, you might not need to fill out a tax return.
- You might not have to complete a tax return if you have income from interest, dividends and savings or if you have dependent children.
- If you have other income, such as from a pension, you’re unlikely to need to file a tax return.
Why Is It Important to Complete a Tax Return?
A tax return is essential to make sure you pay the right amount of tax. For example, if you don’t file a tax return, you may end up paying more tax than you need to. This is because the government will use their best guess as to how much you earned to determine the amount of tax you should pay. This can be inaccurate, as it doesn’t take into account things like expenses and allowances.
How to File Your Tax Return
If you have a simple tax return to file, then you don’t really need to hire a professional to do it for you. You can easily file your return online, and it doesn’t take long.
However, if you’re unsure about the process and what your tax situation is, you may want to ask the help of an accountant. It’s best to do this, as you won’t want to make any mistakes in the process.
If you have other businesses or investments that affect your tax return, it’s a good idea to have a professional look it over. They can make sure to reduce the amount of tax you have to pay as much as possible.
For example, there may be some expenses you can claim as an employee or self-employed person. A professional might also be able to help you reduce the amount of tax you pay.
Whether or not you need to complete your tax return really depends on your situation. However, if you’d like to reduce the amount of tax you’re likely to pay, it’s a good idea to get professional help.
Apply for a tax refund in the UK with the help of the Tax Refund Calculator. Tax Refund Calculator can help you claim back what is rightfully yours. By calculating whether you have overpaid tax due to unused uniform allowance or marriage tax allowance, you might be in for a nice surprise in the form of payment from HMRC. Check your refund now!